Storj.io’s Storjcoin X Advantage
Why does the company use its own currency?
What is Storj.io?
Storj.io, a company recently co-founded by Wake Forest graduate John Quinn, aims to disrupt large cloud computing giants such as Google, Amazon and Microsoft in their quest to create a decentralized platform of the cloud. Their platform consists of a community that contributes their own share of storage space whether it be their 5TB drive in their home office or the 100GB of extra space on their laptop. The data that is then stored on these drives is encrypted and shredded into “shards” which are stored in several places in the network of connected machines. When a user opts to share some of their storage space, they are paid according to how much storage they offer. The currency that is paid out is known as Storjcoin X or SJCX. The user can then store this currency in their own digital wallet so that it can later be exchanged into another type of currency or left for future use.
Why Storjcoin X?
If you are like me, you may have never heard of SJCX before going to the company’s website. But the company uses their own currency for a reason instead of using a more popular blockchain-based currency such as Bitcoin.
The biggest reason for the company’s specialized currency is control. By using their own currency, Storj.io has much more flexibility in the amount of features they are able to implement into their products and services. For example, by using SJCX the company can send other data to an specific address rather than simply the amount of money that would be transferred. The type of data that might be sent could include verification of the user to ensure that the storage they are contributing matches the amount of money they are expected to receive. These types of features that the company plans to implement in the future require a larger amount of metadata sent with each transaction than Bitcoin allows.
The company is also much less vulnerable to the price volatility of Bitcoin. Since they are able to control the limit of coins available, they are able to better predict and analyze the currency’s value. For example, when they initially launched the currency, they set a cap of 500,000,000 coins compared to Bitcoin’s 21,000,000 coin limit.
Where Bitcoin allows for members of its community to “mine” coins by collecting a large amount of transactions made into a list and confirming the transactions, Storj.io does not allow its members to mine for the currency in the same fashion. Instead, the company plans to launch its own version of mining software that its users will be able to use. That way, the company can again control more aspects of their currency.
What about the future?
Storj.io is far from the first company to introduce their own currency. Amazon.com, an extremely prominent online retailer has allowed customers to use its own currency for a while called Amazon Coin.
The difference in this type of currency however is unlike Storjcoin X or Bitcoin, the currency is not based on the blockchain platform which allows users to send currency to different addresses and store the money in a digital wallet, for example. The introduction of currencies such as Storjcoin X that are community-based yet tied to a company is a new frontier that is certainly being discovered. Although Storj.io is able to control how many coins can possibly be in circulation, they are not able to have near the amount of control that a company like Amazon might have in the price of their currency. The community decides the fate of the money after it has been created and announced rather than the company itself.
I am curious to see the development of other types of cryptocurrencies similar to Storjcoin X that are alternatives to other popular cryptocurrencies such as Bitcoin. Companies will be able to choose the currency that suits their needs best and pack it full with features which integrate into their products. Who knows what the future will bring us!
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